Sensex rallies 455 points on global cues: 4 key reasons that fuelled the upsurge

Market breadth was extremely positive with 1,321 stocks advancing against 274 declines on BSE

Capitalising on the bounce-back in overnight US markets and subsequent rally in other Asian indices, key domestic equity benchmark indices started on a robust note with the Sensex surging 455 points to trade above the 26,000-mark amid a strong all-round buying support.

At 9.50 am, the 30-share BSE S&P Sensex was at 25,957.92, up 243.26 points, or nearly 1 percent from the previous close. The broader 50-share CNX Nifty was at 7,868.75, up 76.90 points, or 1 percent.

Market breadth was extremely positive with 1,321 stocks advancing against 274 declines on the BSE.

Leading the upsurge in the Sensex pack, shares of Vedanta shot up 4.8 percent to Rs 89.65, HDFC nearly 4 percent to Rs 1,146, Bharti Airtel 2 percent to Rs 346.50, SBI 2 percent to Rs 250.65, Lupin 1.9 percent to Rs 1,847.20 and Infosys 1.8 percent to Rs 1,084.40.

Among other gainers, shares of Tata Steel, Sun Pharma, GAIL, ONGC, DR Reddy’s, Cipla, Axis Bank and Hindalco were up around 1-2 percent each.

Below are the four key points that helped Sensex clock significant gains in early trades:

On Wednesday, the US markets posted its biggest gain in four years with tech-heavy Nasdaq ending over 4 percent higher while Dow Jones gaining nearly 4 percent and S&P 500 was up 3.9 percent at close. Investors also took heart following a US Fed president’s comments that chances of a September rate hike appears dim in the wake of the recent sell-off across the global markets, including the US.

In Asia, Chinese equity markets, too, staged a smart bounce-back with the Shanghai Composite Index rallying 1.5 percent and Hang Seng soaring 2.6 percent in early trades. Japan’s Nikkei extended its gains for second straight session, rising 1.9 percent.
Further, China’s central bank on Wednesday injected 140 billion yuan ($21.8 billion) into the interbank money market via short-term liquidity operations (SLOs). The facility is mainly used to provide one- to three-day direct lines of credit to commercial banks.

Domestic currency markets also took cues from the upbeat stock market sentiment, as rupee slipped below 66 mark and appreciated by 20 paise to trade at 65.93 against the dollar in early trades.